Case1 Freqon

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1. In order to assess what went wrong in the relationship between Freqon and NordAlu it is important to identify where the problems began. When Freqon moved some of its aluminum components to other suppliers, for the new frequency converter model, without communicating it to Nord-Alu, the trust was seriously damaged. But we argue that the problems began earlier. As discussed by Ford et al. (2006) it is important to study relationships from a time perspective. They argue that one can not asses a relationship in one given moment in time, but that one needs to study the relationship by taking all its history of interactions into consideration. In the first years, both companies were highly involved within joint efforts, taking advantage of each other’s resources and capacities. The relationship between the companies and its employees grew stronger which lead to a relaxed communication style and even friendly personal bonding. However, the coordination of the collaboration was also informal and built upon the personal relationships between the actors. Hence, the actor bonds were very strong but the activity links were not strongly developed. In the beginning of the relationship, there was a keen emphasis on the development of resource ties, focus was given to mutual exchange of resources and capabilities. But this focus faded gradually over time. No one seemed to take responsibility for managing the relationship nor showed interest in maintaining the high commitment level that was present initially. Maybe they became too comfortable to scan for new ways of exploiting each other’s resources and capabilities? Here we can observe the importance of being attentive, to perform continuous assessments of where the relationship is going, and to have an understanding of the evolvement of the relationship over time (Ford, Gadde, Håkansson, 2011). We argue that both companies failed to create a strong foundation for the relationship. As mentioned by Ford et al (2011), actor bonds are the first link in connecting two parties in a healthy and successful business relationship. The fact that strong actor bonds were developed, mutual learning, trust and commitment was high under the first years of the relationship, but we believe that as the actor bonds came to change, so did the trust and commitment between the companies. The organizational changes that occurred (Freqon, 1996-97 and NordAlu, 1998) changed the actors involved in the relationship. This would not have been as devastating for the relationship if activity links and resource ties had been developed to a higher extent. According to the course literature, high involvement relationships include, often, high emotional intensity in the bond, leading to higher commitment expectations. Since all relationships are interpersonal, we believe that an eroded trust between the actors could lead to feelings such as irascibility and frustration and due to the absence of formal activity links and resource ties these personal feelings could seriously damage the dynamics of the relationship. In this case when the actor bonds changed, so did the whole constellation of the relationship. The other links are, as mentioned above, activity links and resource ties. They are normally developed over a longer period of time but are non-the-less important for managing the relationship. Activity links and resource ties allow for a more efficient operation between the companies. Apart from the operational benefits, the links further help to create a more mutual dependence and a closer relationship. (Ford et al, 2011) We argue that the overall failure of developing strong activity links and resource ties was one of the main factors that eventually lead to the current unfavorable state of the relationship. The effects of the weak focus on the resource ties can be enhanced by the dynamics of keyaccount...
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